FINANCIAL FOCUS
KRISTI TREVINO
Financial Advisor
Edward Jones
www.edwardjones.com/kristi-trevino
When Facing Illness, TAKE
CONTROL OF FINANCES
In light of the coronavirus pandemic, virtually all of
us have considered health-related issues. But for
people facing a serious, chronic illness, such as
Parkinson’s disease, multiple sclerosis, diabetes or
cancer, health concerns are an everyday matter. If
you’re fortunate, you may never be afflicted with such
maladies, but the future is unpredictable. Of course,
going through these health challenges bring physical
and emotional concerns – but also financial ones. How
can you prepare for them?
Essentially, you’ll need to consider four key areas:
investments, insurance, legal arrangements and taxes.
Let’s take a quick look at each of them:
Investments – You’ll likely need to draw on your
investments for at least some of the expenses
associated with your illness. So, within your portfolio,
you may want to establish a special fund devoted
entirely to these costs, whether they be health care,
modifications to your home, transportation and so on. A
financial professional can help you choose investments
for this fund, as well as make recommendations for your
overall investment strategy, including techniques for
boosting your income, such as adding investments that
can provide an income stream that kicks in when you
think your costs will rise.
Insurance – Depending on your health status, you may
be able to collect Medicare earlier than the traditional
starting point at age 65. Even so, you’ll likely need to
supplement it with additional coverage. But you may
also want to look beyond health insurance. For example,
you might be able to purchase a “chronic illness rider”
that allows you to tap into life insurance benefits while
you’re still alive. Or you might consider adding a “longterm
care rider” to a life insurance policy; this rider
offers financial benefits if you ever require daily care that
you can’t provide for yourself. And some foundations,
states and drug companies offer programs that can help
pay for some costs that your insurance won’t cover.
Legal arrangements – If you haven’t already done so,
you may want to establish the legal documents most
appropriate for your situation, such as a durable power
of attorney for finances, which gives someone the
authority to manage your financial affairs if you become
temporarily incapacitated, possibly due to flare-ups
of your chronic disease. Once you’ve recovered, you
regain control of your financial decisions. You might also
want to consider a health care proxy, which appoints an
individual to make medical decisions for you if you can’t.
In creating or revising these documents, you’ll need to
consult with your legal professional.
Taxes – You might qualify for Social Security disability
payments, which, like other Social Security benefits,
are taxable, so you’ll need to be aware of what you
might owe. But you might also be eligible for some tax
breaks related to your condition. If you still itemize tax
deductions, you may be able to deduct some medical
expenses, as well as certain home improvements, such
as wheelchair ramps, bathtub grab bars, motorized
stairlifts and so on. Your tax advisor may have
suggestions appropriate for your situation.
Dealing with a chronic illness is never easy. But by
considering how your illness will affect all aspects of
your life, getting the help you need, and taking the right
steps, you may be able to reduce the financial stress on
you and your loved ones.
20 MOMENTUM